Legal development

Food Law Bite Grape Co penalised

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    What you need to know

    • Grape Co, an Australian grape trader, has been issued infringement notices by the ACCC and paid penalties totalling $34,920.
    • Grape Co represented that its grapes solely came from its family estate, when at least some of the grapes were grown on third parties' properties. The ACCC alleged that this amounted to false and misleading conduct under the Australian Consumer Law.
    • Grape Co also allegedly traded without written agreements when acting as an agent for growers, and failed to make its terms of trade available to the public, each of which was in breach of the Horticulture Code of Conduct.

    What you need to do

    • Ensure that any representations about the origin of your products are correct and not misleading.
    • If you trade in horticulture produce, make sure you have written agreements when you are dealing with growers, and make your terms of trade publicly available (eg at your website).
    • Be aware that enforcement of the Horticulture Code is an enforcement priority for the ACCC in 2021.

    Grape Co Australia Pty Ltd and Grape Co Farms Pty Ltd (together, Grape Co) have been issued with three infringement notices by the Australian Competition and Consumer Commission (ACCC).

    Misleading and deceptive conduct

    The first infringement notice resulted from Grape Co's publication of the following statement on its website:

    "every single one of our grapes is personally hand-selected from the finest fruit on our family’s estate in Sunraysia Australia."

    The ACCC investigated this claim and found that at least some of the grapes were grown on third parties' properties. The ACCC therefore alleged that the claim was misleading and deceptive.

    The Deputy Chair of the ACCC stated "consumers looking to support small businesses may make purchasing decisions based on representations that the produce is sourced from a family farm, and it is important they are not misled so they get what they pay for".

    Breach of Horticulture Code

    The second and third infringement notices resulted from the ACCC's investigations into Grape Co's alleged breaches of the Horticulture Code of Conduct (an industry code under the Competition and Consumer Act 2010 (Cth)). Grape Co allegedly traded without written agreements when acting as an agent for growers, and failed to make its terms of trade available to the public.

    The Deputy Chair of the ACCC stated "it is important that traders have written agreements with growers so that both parties clearly understand their rights and obligations and what can and can’t be done under the agreement" and "terms of trade allow growers to understand the services and aspects of trading provided by different traders, so that growers can make an informed decision as to who they wish to supply produce to".

    As a result of the infringement notices, Grape Co agreed to pay penalties of $34,920 set by the ACCC.

     

    Authors: Will Scott, Senior Associate; and Anita Cade, Partner